To open a bitcoin-backed loan, ensure you meet the eligibility requirements and have sufficient bitcoin in your Strike account for your intended loan size.
Before you begin:
Prior to opening a loan, familiarize yourself with how bitcoin-backed loans work, including the Loan-to-Value (LTV) ratio, how payments work, and margin calls and liquidations.
How to open a bitcoin-backed loan:
To open your loan, ensure your Strike app is up to date, then visit your Strike app’s Cash tab, and select the "Bitcoin-backed loans" card and follow these steps:
- Select loan type: Choose between "Monthly Interest" (interest paid monthly, principal paid at maturity) or "Payment at Maturity" (interest and principal paid at maturity).
- Set loan amount: Adjust the slider to select your desired loan amount, which affects the required collateral and interest cost.
- Set collateral amount: Adjust the slider to set your collateral amount. Remember, adding extra collateral reduces the bitcoin prices at which margin calls and liquidations occur.
- Choose payment source: Select your preferred source for automatically paying your monthly interest (if applicable) and maturity payment.
- Enable notifications: Ensure notifications are enabled for the Strike app to receive important loan updates.
- Preview loan details: Review your loan configuration.
- Review and sign agreement: The loan agreement will be emailed to your account for review. If you accept, return to the Strike app to sign your screen and tap “Initiate loan” to complete the process.
After your loan is opened:
Once your loan is opened, your bitcoin collateral will be immediately debited from your bitcoin balance and the cash will be credited to your cash balance.
On your Cash tab, you’ll find your LTV Tracker, which provides a quick overview of your loan’s health. If you tap your LTV Tracker, you can access your Loan Center where you can monitor and manage your loan.